Organization Studies
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`The One-Company Approach': Transnationalism in an Israeli−−Palestinian
Subsidiary of a Multinational Corporation
Galit Ailon and Gideon Kunda
Organization Studies 2009 30: 693
DOI: 10.1177/0170840609104808
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article title
‘The One-Company Approach’: Transnationalism
in an Israeli–Palestinian Subsidiary of a
Multinational Corporation
Galit Ailon and Gideon Kunda
Abstract
Galit Ailon
Bar-Ilan University,
Ramat Gan, Israel
Gideon Kunda
Tel-Aviv University,
Tel Aviv, Israel
This paper presents an ethnographic study of the Israeli–Palestinian subsidiary of a
multinational hi-tech corporation. Critiquing the tendency of globalization theorists to
conceptualize multinational corporations (MNCs) solely in terms of their impact on
their external environment, this paper looks inward and examines the ideological and
practical constituents of the transnational regime of consciousness as expressed
through what management titles ‘the one-company approach’. We argue that this
regime lays foundations for a transnational ‘imagined community’ which does not rival
the national one, but internalizes it, creating an arena of discretionary power for managers: deciding when to activate and when to suppress nationality in the global organizational universe. This study analyzes the relationship between transnationalism and
nationalism inside the organization, and its implications for understanding MNCs’ role
in globalization.
Keywords: globalization, Israeli–Palestinian conflict, control, multinational corporations,
nationalism, transnationalism
Organization
Studies
30(07): 693–712
ISSN 0170–8406
Copyright © The
Author(s), 2009.
Reprints and
permissions:
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Students of globalization typically emphasize the role of multinational corporations Multinational Corporations (MNCs) in the development of the global system.
Some MNCs, they argue, have freed themselves from nation-states to the degree
that warrants viewing them as transnational actors, competing with nation-states
on the global stage. Constituting ‘the most important and most powerful globalizing institutions in the world today’ (Sklair 2002), the actions of these corporations,
in this view, have far-reaching consequences: They are richer than most countries
(Sklair 2002), and control much of the world’s investment, capital, and technology
(Steger 2003; Burbach and Robinson 1999); they are an origin of transnational culture (Hannerz 1996; Appadurai 1990) and the worldwide diffusion of consumerism (Sklair 2002); and they play a central role in national politics, possessing
the power to veto political decisions and bypass established political arrangements
(Barnet and Cavanagh 1994). As their global circuits of production and exchange
increasingly straddle and manipulate national systems of regulation (Amin 1997),
governments’ sovereignty over their own territories declines and the effectiveness
of national political authorities is eroded (Held 1995; Sassen 2000). Indeed, even
those who argue that the impact of globalization has been exaggerated and that
there is neither a global economy (Hirst and Thompson 1996) nor a global culture
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DOI: 10.1177/0170840609104808
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(Smith 1990), acknowledge the role of MNCs in inspiring these images and
embodying the partial changes that are taking place.
Most evaluations of MNCs’ global role and significance focus on their strategic orientation and the outcomes of their business activities for their environments. Revealing as such a perspective may be, it constructs MNCs as ‘black
boxes’ with little conceptualization of their internal processes. When this ‘black
box’ is opened and explored, however, MNCs appear less global than theorists
presume. Research influenced by the National Business Systems approach
(Whitley 1999) and focusing on internal practices, reveals a complex organizational environment characterized by pressures to conform to MNCs’ institutional
contexts of origin (Hu 1992; Doremus 1998) as well as to the host institutional
environments in which their subsidiaries are embedded (Tempel et al. 2006;
Matten and Geppert 2004; Geppert et al. 2003). Indeed, rather than embodying
simple convergence on a global scale, MNCs become arenas for ‘micro-politics’
whereby managers negotiate, contest, challenge, or reassert headquarters’ influence (e.g. Kristensen and Zeitlin 2005; Morgan and Kristensen 2006; Geppert
and Williams 2006; Ferner et al. 2005; Sharpe 2006; Geppert and Mayer 2006;
Geppert 2003; Dörrenbächer and Geppert 2006). Similarly, more-managerially
oriented literature has identified tensions between requirements of global competition and host country demands (Doz et al. 1981), and posed their balancing as
a core managerial mission (Prahalad and Doz 1987; Bartlett et al. 1990). And
researchers exploring national identities in MNCs argue that they are continually
expressed through cross-cultural gaps (Hofstede 1980; for a critique, see Ailon
2008) or relationally negotiated stereotypes (Søderberg and Vaara 2003), and that
they are widely used as symbolic resources in intra-organizational struggles
(Ailon-Souday and Kunda 2003; Ailon 2007). In this view, then, national boundaries are continually expressed inside the MNC (see also Morgan 2005).
The fact that national institutions, markets, and identities are expressed inside
MNCs calls into question global or stateless images of them promulgated by
scholars ranging from managerially oriented (Ohmae 1995, 1999) to Marxian
(Sklair 2002; Robinson and Harris 2000). Nevertheless, even if the validity of
these images is challenged, the critical question that inspired them in the first
place is not addressed. If, as Anderson (1983) has argued, the power of nationalism rests upon a particular form of ‘imagined community’ — a sovereign but
limited communion that inspires deeply felt solidarity and sense of comradeship with many anonymous compatriots — the question is not whether MNCs
have obliterated expressions of nationality, but whether they have set up a
regime of consciousness that rivals it. Do MNCs offer their employees transnational imagined communities that compete with or replace national affiliations?
To address this question, we offer ethnographic evidence from our study of an
Israeli–Palestinian subsidiary of an MNC. Our goal is to ‘ground globalization’
(Burawoy 2000) and study it in a field in which the forces of nationalism are rampant. This field, we claim, is well suited for exploring globalization not as a ‘given’
but as a process of complex interplays between social forces. In particular, we analyze the ideological and practical constituents of the MNC’s formal global work
order, its interplay with nationalism, and the extent to which it creates a transnational
regime of consciousness that transcends traditional boundaries and affiliations.
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MNCs and Transnationalism
In the past two decades, students of globalization have explored different arenas in
which a transnational consciousness takes root and transnational communities
develop. They have focused on contexts characterized by ‘multiple ties and interactions linking people or institutions across the borders of nation-states’ (Vertovec
1999: 447), such as immigration, diasporas, global cities, borderlands, and technological networks (for reviews see, e.g., Portes et al. 1999; Vertovec 1999; Glick
Schiller 1997). According to Glick Schiller (2005), these studies have substantially
challenged ‘methodological nationalism’ — the tendency to equate the term ‘society’ with the boundaries of nation-states. Yet they have also tended to lose sight of
the power relations and organizations that structure transnational flows and mediate the intersection of the individual and the global (Glick Schiller 2005: 441).
One type of organization especially critical in this sense is the large, multinational business corporation. While many students of globalization realize that
organizations of this type have a clear role in the restructuring of capitalism, development of consumerism and global culture, and reconfiguration of global power
structures, there is little recognition that MNCs have also begun to create ‘transnational social spaces’ (Faist 2000) with distinct actors, rules, and patterns of social
interactions (Morgan 2001a, 2005). MNCs, Morgan (2001a:127) claims, are ‘ripe
for detailed ethnographic and qualitative studies that can shed light on the degree
to which these are simple extensions of national practices to an international level
or are in fact constituting new forms of transnational communities’ (see also
Morgan 2001b: 21). Indeed, ethnographic studies, with their lengthy immersion in
a field and their focus on everyday work processes, can shed light not only on the
extent to which MNCs are constituting a new form of transnational community,
but also on the complexity and dynamics of this constitution.
Morgan’s description of MNCs as ‘transnational social spaces’ is not accompanied by an assumption that this space exists in a stateless vacuum. In fact,
he claims, these firms are ‘deeply socially embedded in national institutional
contexts’ (2001a: 127), while nonetheless potentially creating a new level of
social interactions and relationships. That the transnational and the national
are not mutually exclusive but rather interconnected has recently been acknowledged by students of other forms of transnationalism (see, e.g., Djelic and
Sahlin-Andersson 2006). Thus, theorists in the field of ‘transnational studies’
have begun questioning the tendencies to disregard how states and the politics
conducted within them are related to transnational social orders (Waldinger and
Fitzgerald 2004) and to overlook the continuing power of the nation-state (Glick
Schiller 2005: 442). The critical question, it seems, is not if nationalism
expresses itself in transnational social spaces but rather, in what manner does it
come into play and, moreover, to what effect?
Our study offers a rare opportunity to explore the workings of a transnational
corporate order — its structures and routines — at a place and a time in which
nationalism and national politics were dramatically manifested. In other words,
it offers the opportunity to explore transnationalism in an organizational ‘social
space’, to understand the way it shapes and channels the intersection between the
individual and the global, and to explore its interrelations with nationalism.
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Setting and Methodology
Our study began in the summer of 2002 in the Israeli–Palestinian subsidiary of one
of Fortune’s Global 500, a high-tech corporation we refer to as ‘GlobalNet’ (GN).
Founded in a European country, in 2002 GN employed over 100,000 employees
from 140 countries. Its Israeli–Palestinian subsidiary was a customer support unit
serving clients on both sides of the ‘Green Line’ — the border of Israel established
in 1948, beyond which lie the territories occupied in 1967. It consisted of a central
unit, located near Tel-Aviv, and a field office in Ramallah, a Palestinian town across
the Green Line. To reflect the fact that the subsidiary’s name referred only to its
Israeli — not Palestinian — component, we name it here GNI (and not GNIP). The
Tel-Aviv office included several ‘expatriates’ — foreign citizens, mostly European,
on temporary assignment to high-ranking managerial and professional positions
(the CEO, a vice-president and customer-support engineers) and approximately 80
local employees (mostly project managers and customer-support engineers, as well
as several information technology, human resources, finance, and import/export
workers). The local employees’ nationality and citizenship reflected the complexity
of the political situation. Of those employed in the central unit near Tel-Aviv, all but
a few were Jewish-Israelis. The rest were Arab-Israelis and Arab residents of East
Jerusalem (the former are Israeli citizens while the latter are formally residents, not
citizens, of Israel). The Ramallah office employed eight local Arab-Palestinian
engineers. Due to the political circumstances, they could only rarely, and only with
considerable difficulty, visit the Tel-Aviv facilities.
Because of the tensions between Israel and its neighbors, GNI was not part
of GN’s Middle Eastern market unit. Instead, it was part of GN’s Turkish subsidiary, forming a separate Turkish–Israeli market unit, headed by Istanbulbased managers, most of them Turkish. Turkey, while formally a secular state, is
culturally, and increasingly politically, Islamic, albeit non-Arab. Nevertheless,
its relationship with Israel is normalized; for Israelis this represents a desperately sought legitimacy granted by a significant Mideastern country; for many
Palestinians it represents a resented undermining of Islamic solidarity. For GN
it was an opportunity to circumvent political constraints on its global rationality.
Fieldwork was conducted while the region was in turmoil. The Second Intifada
— the Palestinian struggle against Israeli occupation — was at its peak, producing
a vicious cycle of violence. Israel conducted continual military activities in the territories: incursions into towns and villages, patrols and roadblocks, targeted assassinations and punitive destruction of homes. Palestinians engaged in armed attacks
on vehicles and military outposts, and suicide bombings of buses, cafes and restaurants in Israel. Moreover, this was a period marked by the buildup towards the second Gulf War, further polarizing residents of the region and heightening tension and
anxiety: in every household, rooms were being sealed, bomb-shelters opened, gas
masks prepared, and supplies stored.
Thus, our fieldwork took place in the context of crisis, conflict, and
heightened awareness of, and attachment to, national and ethnic identities.
These attributes of our field, we believe, highlight social processes that are
presumably more subtle and hidden in ‘normal’ environments. Our goal was
to explore the organizational universe that GNI’s employees populated and
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to discover the elements that made up what they humorously referred to as
the ‘global bubble’ floating in the midst of the ongoing violent local conflict.
Fieldwork was conducted at GNI’s Tel-Aviv facilities for one year. Given the
long history of the Israeli–Palestinian conflict and the even longer history of globalization, this is, in one sense, but a snapshot of a moment in time. In another sense,
however, it is anything but a snapshot: one of the strengths of ethnography is its
processual approach and ability to grasp the nuances and complexity of everyday
life as it unfolds, both of critical importance to our research question. Our research
consisted of participant observation, unstructured interviews, and document analysis. We scrutinized the data, generated and verified interpretive codes, and then
reanalyzed material associated with each to validate, refute, or modify themes.
While all ethnographic accounts are situated narrations, issued from and bounded
by the researcher’s location, our identity as Jewish-Israelis is of particular significance. Most of our access was limited to events and scenes populated or dominated
by Jewish-Israelis. Circumstances prohibited fieldwork across the Green Line and
our interviews with Palestinian workers were conducted in Tel-Aviv or East
Jerusalem (accessible to people from both sides of the Green Line) in English and
imbued with awareness of our conflicting identities. Thus, our ability to see, understand, and depict ‘the other’ was in this sense limited and our report should be read
with this limitation in mind. Still, since this paper deals with the ideological and
practical underpinnings of the formal work order, our primary focus here is on
another and, to some extent, shared ‘other’: European management and the elements
of its global ambition.
The Everyday Work Order: Implementing the
One-Company Approach
Implementing a global perspective in a world dominated by national identification is
not an easy task under the best of circumstances — and, in Spring 2003, as the war in
the Gulf seemed imminent, circumstances were far from ideal. Peter, GNI’s CEO, a
citizen of GN’s home base, a veteran of many international assignments and a resident
of Israel for four years, was apparently well aware of the simmering tensions as he
entered the company dining room where employees had assembled for the monthly
meeting. All employees were in attendance, with the exception of the Palestinians from
Ramallah: the authorities had, as usual, refused to allow them to cross the Green Line.
Once everyone was seated, Peter opened the meeting. He laid out the agenda,
promising to ‘talk a little about the emergency’, but only towards the end of the
meeting. Then he quickly turned to the business of the day, seemingly unaffected
by ‘the situation’: a market analysis, a review of corporate goals, and an explanation of the employee incentive program. Peter, in short, chose to acknowledge the
situation, but not to let it dominate the proceedings.
When the ‘security issues’ turn finally came, Peter’s message was clear: everything is under control. ‘Despite the heightened tension,’ he said, ‘we’re still on Alert
Level One. It was raised from Zero long ago due to the Intifada. Although we’re discussing raising it to Level Two, we haven’t done so yet.’ Peter added that the
‘Corporate Crisis-Management Center’, located at GN headquarters, created and
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disseminated ‘global guidelines on how to behave in instances of earthquakes,
plagues, and wars’. The crisis center, he revealed, was convened to discuss the situation, and its experts decided that ‘GN will not opt for early evacuation’ of expats.
‘I’m not talking only about Israel,’ Peter emphasized, putting, as he invariably did,
local concerns in a broader perspective. ‘It’s Lebanon, Iraq, Iran, Kuwait … and
also Israel.’ When a participant called out from the back, ‘No problem! We can
bring them all here’, Peter conceded that ‘each faces different kinds of danger’, and
‘It’s sad that Israel is in a special spot’, but then quickly reassured everyone that
‘GNI is ready for the situation. There is a thick binder of emergency documents that
will hopefully work like client binders: we always prepare a 400-page contract and
then put it on the shelf.’ Moreover, he added, the ‘Emergency Steering Group’ consisting of VPs and security officers, had prepared ‘emergency plans’ designed to
protect clients because ‘business must go on’. The group, he added, ‘is debating
who will run to the bomb-shelter and who to the sealed warehouse’ — the former
was considered to be better protected and safer — ‘but we’ll probably let the managers think this through and decide’.
As Peter spoke, it became apparent that his words were designed to spread GN’s
global wings over the local crisis, standardizing it and transforming it into a managerial problem to be dealt with like other problems in its business environment. He
closed the discussion on ‘security issues’ with a personal note: ‘I intend to stay in
Israel. I’ve discussed this with headquarters. I won’t be evacuated, in order to try to
contribute to the situation.’ The audience responded with a round of applause.
Thus, the meeting, like other events during these tense days, included an
overt managerial effort to muffle, if not completely subdue, the unmistakable
beat of the drums of war threatening to disrupt the rhythms of corporate life.
This, like many other types of local ‘noise’ — produced by language barriers, cultural gaps, distinct time-zones, behavioral differences, national boundaries,
and geographical distances — were systematically and continuously subjected to a global corporate logic. Accordingly, Israel could be grouped with
Iran and Kuwait, emergency documents compared to sales contracts, and alert
levels determined by the directives of distant corporate crisis centers. In
short, local realities, no matter how disruptive, must be continuously domesticated to fit the dictums of work-life in a global corporation.
But local realities, of course, cannot be entirely controlled, not even on
this formal occasion. It was no coincidence, participants later told us, that
the CEO was from GN’s home base. He received applause not by hiding his
national origin but by using awareness of it to underline the heroic aspects
of his decision to stay on in a war-zone. Israelis in the audience were clearly
aware of their collective predicament and unabashedly expressive of their
feelings about it. Invited to attend, yet conspicuously absent, were the
Palestinian employees from Ramallah. As for the expatriates present, they
knew — as did everyone else — that if war broke out they would be quickly
evacuated. Moreover, they received just-in-case gas masks from the company; a benefit withheld from the Palestinians in Ramallah despite the fact
that they too did not receive masks from Israeli authorities. Nevertheless, the
boundaries between members were temporarily suspended, rhetorically at
least, to allow the smooth enactment of the collective interest.
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As we will argue, the question of where, when, and how national distinctions were allowed to surface in global corporate life, how they were manifested and interpreted, and to what effect they were put to use, was a complex
matter involving an intricate interplay of explicit and implicit messages and
subtle, carefully staged interactions. Before dealing with the exceptions, however, we must first learn the rule. We return to Peter’s presentation as the last
agenda item flashed onto the screen. In large black letters it read: ‘The OneCompany Approach’.
GN’s Transnational Regime of Consciousness
The words on the screen and the meanings they conveyed were a regular backdrop to everyday life in GNI, and familiar to all participants. Generally speaking,
the explication and dissemination of the ‘One-Company Approach’ represented
a managerial attempt to control boundaries considered, from a global perspective, disruptive or dysfunctional. They seemed designed to promote a desired
behavioral orientation, on the part of members, based upon two interconnected
elements: acknowledgment of externally determined national and cultural boundaries between employees, and willingness to silence, ignore, or overcome them.
Continuing, Peter addressed a particular instance he saw as an opportunity to
reiterate the message. Referring to the outcomes of an employee attitude survey,
he admonished his employees:
‘Many sentences in this document indicate that you try to cover your own asses by
saying, “GN-England did not deliver”, “GN-Thailand are so stupid it is impossible to
deal with them”. This isn’t the way! We are one company! We are GN! We give solutions to customers and we don’t use other parts of the company to cover our asses.
I received a message from one client that we do this. GN is GN. We are the front of
the One-Company approach. It is easy to say, “We didn’t get an answer in time” or
“they didn’t support us”. When you want to say this — bite your tongue! Because our
clients see it as a weakness. Don’t blame someone else inside GN!’
Peter’s request resonated with the image that the company projected in its public
relations efforts. In newspaper articles on both sides of the Green Line, managers
depicted GN as a global entity, stressing the fact that the local subsidiary was but
an extension of a unified global giant — an image that was designed to appeal to
the diverse interests of many different constituencies — clients, suppliers, government agencies, and the press.
But accomplishing this was more than a public relations game. The ‘onecompany approach’ was also oriented to shaping the views and behaviors of internal actors — the local employees and managers who were expected to shed the
work-related expressions of their local identities and conform to global standards and
expectations of outside constituencies. It represented, in short, management’s desire
to manage relationships between employees of the multinational organization.
Central to the internal implementation of the one-company approach was the need
to control the national boundaries that separated employees and were believed
to undermine efforts to create a smoothly functioning global organization. This,
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however, was a daunting task. Like the British Empire of old, the sun never set on
GN. Employees never encountered more than a fraction of the workforce. Moreover,
effects of the size of the company and dispersion of its members on their workrelated interactions paled in comparison with social distances based on nationality,
religion, language, and culture. To mold the workforce into ‘one company’, management engaged in a three-pronged effort: it fostered a rhetoric of community, built
transnational networks, and sought to tame national cultures.
Rhetoric of Community
Creating ‘one company’ began with designing and disseminating symbols of a
cohesive community. Representations of a common identity and purpose were
ubiquitous. The corporate logo appeared on every piece of paper, web page,
name tag. GN’s mission statement was featured prominently on bulletin boards,
intranet pages, and presentation slides. Monthly CEO letters posted on the
homepage of every subsidiary used the plural ‘We’, emphasized common challenges, and used an intimate tone implying a common goal and destiny. Similar
messages were conveyed by news items posted on the web and newspaper clippings displayed on bulletin boards, containing reports about GN, its challenges
and successes. Thus, representations of a unified organizational community facing
common struggles formed a ubiquitous backdrop for everyday organizational life.
Emblems of a global corporate identity were complemented by managerial
efforts to highlight cross-organizational contributions. Management constantly
informed employees of the productive presence of the other members and their
successful efforts to contribute to the accomplishment of common goals. Thus,
company meetings typically opened with reports of employees’ achievements
from around the world. These were also reported in the extensive internal corporate media. Corporate newsletters used an optimistic and admiring tone as
well as colorful images; members portrayed in them were always smiling and
usually young and good-looking. Everyday work-life might threaten to engender in members a feeling that they were anonymous nodes in a huge network,
but corporate rhetoric attempted to endow it with the aura of a dedicated, energetic, attractive face-to-face community.
The sense of community was also promoted by a corporate policy that
required the use of standardized formal categories and corporate rituals. Ranks
and job titles were globally standardized, offering a common means of conceiving
the distant and different organizational others. Work-related rituals and activities, such as performance evaluation and monthly company meetings, were performed across the company, bolstering the notion of a common framework for
experience. Similarly, uniform rules for promotion, and standardized training
and education activities complete with web-posted textbooks and diplomas,
enabled members to see themselves as participants in a unified community and
coherent universe of meaning.
Efforts to create a community went even further: agents for the corporate interest tried to shape also the underlying experiences of members. Speeches, posters,
and assessment procedures reminded employees that they were required to
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incorporate a list of ‘our values’. Although loosely defined and abstract, these
values were ‘exemplified’ through a long list of behaviors and orientations such
as ‘We are committed to our customers’ success’, ‘We care about what is important to our customers and employees’, and ‘We build long-term relationships with
our customers’. Examples of such ‘required behaviors’ were widely disseminated
in the corporate media and illustrated and practiced in training events. They were
also enforced through a uniform process of ‘competence development’ designed
to identify and develop people’s skills in accordance with organizational needs.
Transnational Networks
Transnational networks that crisscrossed the company’s formal structure were
perhaps the most prominent manifestation of the ‘one-company approach’.
Consider the following example. Yossi, a GNI support engineer, received a client
call reporting a technical problem and demanding a solution ‘yesterday’. Yossi
visited the client, examined the system and diagnosed the problem, but, due to its
complexity, was unable to solve it immediately. Returning to his office, he documented the problem, asked colleagues if anyone had ever encountered anything
similar, and then tried his luck on the intranet for information that might help
solve it. When none was found, he faced two options: one formal, one semiformal. The formal option was to turn to GN’s ‘second-line support’ system. The
system was based on a principle referred to as ‘Follow the Sun’: support sites
were located in three different countries eight time-zones apart, to ensure aroundthe-clock support. Yossi was familiar with this system and knew that it faced a
heavy worldwide influx of reported problems. Israel being a small market, Yossi’s
problem was low priority, and responses would be delayed. Though delays were
never long, clients — and particularly Israeli clients, Yossi believed — were
impatient and demanding.
Facing such pressures, Yossi, who had been around for a while and knew how
things worked, turned to the second option. He opened his box of business cards —
every member seemed to have one — and sifted through them. He had collected
these cards from members from other countries he had met at meetings and training events. Picking out the card of someone he thought could help, he wrote him an
email (in some cases, he might have called too, depending on the time-zone and the
nature of the relationship). He was careful to begin with a personal note, asking
‘How was your weekend?’ Only then, did he ask his question. From experience he
knew that if the person didn’t know the answer, he could probably name someone
who did. Armed with an introduction, he would then contact the new name and continue tracking down the information he needed. He believed that, with appropriate
contacts and networking skills, this method would yield a much quicker and more
helpful reply than the second-line support system.
While more personal in nature, this alternative channel was not entirely informal:
management declared it an ‘important characteristic of GN’ (CEO Monthly Letter)
and tried to encourage and support it. To do this, the company offered a wide variety
of multinational training events and conferences; it encouraged members to
socialize with members from other countries and explicitly stated how critical such
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activities were for smoothing the flow of information and resources. Most crucially,
perhaps, the company provided the technical means for such interaction: GN’s
intranet, a vast communication and data management system that facilitated,
smoothed, and encouraged ‘networking’.
In addition to its functional role in fostering and facilitating the behavioral
expressions of the one-company approach, GN’s intranet also had a symbolic role
in defining its overarching meaning. The intranet was a powerful symbol of the
managerial view of the organizational world as a single community, global in
scope yet solidified and interconnected. Consider, for example, the sites of the different subsidiaries. Each subsidiary was named after the country in which it was
located, and the country’s name appeared prominently on its home page along
with a national flag icon, waving on the side of the screen, and links to sites containing local information ranging from economic statistics through entertainment
to traffic updates. At the same time, however, the sites’ design was highly uniform.
All displayed GN’s logo, presented similar icons’ menus, contained several images
taken from GN’s advertisement portfolio, and offered links both to corporate sites
such as ‘GN News’, ‘GN InfoCenter’, and ‘CEO Updates’, and to identical local
sites identified by unified corporate jargon. The sites’ coexistence and similarity,
and the fact that widely dispersed members were just a click away from each other,
made the intranet a powerful manifestation of the idea of a diverse yet cohesive
community, further reinforced through the working of the social network.
Thus, GN did not only set boundaries between geographies, functions, hierarchical levels, and professional categories, but also gave its members the legitimacy, the opportunity, and the means to cross these boundaries. By formalizing
the informal work practices, GN sustained two structures simultaneously: a geographically based and hierarchically organized structure overlaid with a dense
technologically supported social network.
Taming Local Culture
Although GN promoted the image of a cohesive community and attempted to standardize the experience of employment, management recognized one source of
experience as both strong and impossible to homogenize: the employees’ national
cultures. These were seen as sources of diverse, objective, predetermined, and
unalterable traits (see Ailon 2007, 2008). Nevertheless, the one-company approach
suggested that cultures could at least be tamed. Management’s efforts to do this
took two forms: behavioral and ceremonial.
Behavioral Taming
The attempt to manage behavioral expressions of members’ national–cultural
traits occurred in cross-cultural workshops. Run by an external consultant who
specialized in cross-cultural management, they were designed to increase members’ awareness of behavioral tendencies that were supposedly imprinted in
them by their national cultures. These workshops thus seemed to have had the
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effect of reifying national cultures as strong, objective, and predetermined. As
members learned to appreciate how deeply they ran and how thoroughly they
shaped their minds and conduct, they were asked to monitor their unconscious
expression in intercultural interactions so as not to offend partners to interaction
who were of a different cultural origin. Members were thus taught to become
aware of and refrain from exhibiting some of their culturally induced behaviors
when interacting with members from other cultures.
During fieldwork, several cross-cultural workshops took place, all focused on
the Turkish and Israeli ‘culture gap’; none tackled a Turkish/Palestinian or
Israeli/Palestinian ‘culture gap’. By not acknowledging the Palestinians as a distinct cultural unit and by defining GNI’s culture as Israeli, the workshops both
suppressed the conflictual national boundaries that sliced through the membership and reified the external power structure. Indeed, a Palestinian engineer told
us that ‘we thought that we were neglected at some stage. As if they put an office
in Ramallah and then forgot all about it.’
Thus, in the workshops, the concept of ‘culture gap’, with its connotation of
neutral differences and apolitical diversity, was kept away from the arena of
national conflict, remaining, in a sense, connotatively ‘clean’. But, in another
sense, this concept was also turned into a mechanism for silencing Palestinian
employees and hiding Palestinian–Israeli tensions, making it evident that it was
not diversity that the company acknowledged but manageable diversity: the
diversity that could be contained by its existing arsenal of management tools.
Ceremonial Taming
Ceremonies at GNI also focused exclusively on the Israeli–Turkish distinction.
Here, however, the taming of culture took a different form: rather than toning
down cultures of origin, as in the cross-cultural workshops, members were urged
to ritually display them. Consider GNI’s ‘Hanukkah/Christmas Party’, an especially festive occasion due to the visit of the Turkish management team:
‘The crowded dining room is decorated with religious symbols: on the tables are baskets of
Sufganiyot [Hanukkah donuts], and several Hannukiyot, [traditional candle-holders], each
with colorful candles in place. In the corner of the room stands a plastic Christmas tree
adorned with cheerful ornaments. As the Turkish guests are escorted in, the crowd grows
silent. Peter [the CEO] moves into the center and says: “First, we will introduce everyone.
Our friends from Turkey are with us today. Now I will introduce our employees to the
guests. Not everyone is here because we have work outside the office.” At this the Turks and
Israelis exchange smiles. “Today we will introduce the XXX container we imported from
Europe for the Israeli telecommunication exhibition and discuss the exhibition, which we
feel was very successful. Then we will move on to the second part: we are a multinational
company and we are celebrating several events. In the corner we have a Christmas tree and
for the major part, the Jewish part, we have a Rabbi.” He points to an Israeli VP, explaining:
“This is our Rabbi, Noam. He will introduce the Jewish holiday, Hanukkah.” The Israelis in
the audience laugh; Noam is not religious and certainly not a Rabbi. With an exaggerated
flourish, he takes a skullcap from his pocket and puts it on his head. The laughter increases.
This is a complex performance, a semi-serious display of a Jewish religious identity by a
secular Israeli, directed by a Christian stage-manager, for an Islamic — albeit non-Arab —
audience. The only Palestinian to take part in this event, a senior manager from East
Jerusalem, now arrives. Seeming uncomfortable, he remains standing at the entrance.
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Organization Studies 30(07)
An IT employee tries to begin the PowerPoint presentation. The computer does not work.
Someone asks, “Noam, don’t you have a prayer for the computer?” Somebody else adds: “We
sure need a Hanukkah miracle now!” Finally, the computer is made to work and two professional presentations ensue … “And now!” Peter declares when they are over, “to our Rabbi!”
Noam steps up, straight faced. He briefly and, even by the loose standards of local ceremonies, quite imprecisely explains the origins of Hannukah: “Traditionally we had a historical situation, a war between the Jews — the Maccabim — and the Greeks. There was
a miracle: they found oil that helped them light the Menorah in the Temple for eight days
and thus”, he picks up the Hannukiya, “we have this instrument.” There is laughter and
some of the Israelis in the audience repeat his odd choice of a word for the religious artifact. Smiling, Noam continues: “We also have a traditional cake,” he picks up a Sufganiya,
“only 1000 calories each! There is also a prayer that I will say and then we will sing holiday songs.” Noam says the blessing, lights the candles, and the Israelis — partly audience,
partly co-actors — answer “Amen”. “Now”, he declares, “we will sing.” While all JewishIsraelis join in, uneasy laughter is heard, indicating how awkward the event is for them.
After three songs someone calls out in Hebrew, “Higzamta!” meaning, “you are overdoing it!” More uneasy laughter follows and finally Noam says, “thank you”. Closing the
event, Peter cries out: “Please help yourselves to the low-calorie cakes!”’
The Hanukkah/Christmas party was thus a stereotypical performance of a cultural
identity. It was imbued with self-consciousness produced by the awareness of
the presence of strangers whose own religious identity — Islam — was politely
ignored, seemingly in accordance with the local political narrative, carefully
avoiding any problematic national issues that could threaten the sense of internal
peace that the event was designed to produce. At the behest of their manager, the
Jewish-Israeli members collaboratively enacted an image of their local culture,
generating a friendly and seemingly ‘authentic’ cultural spectacle of the sort that
the tourist industry often produces. The only Palestinian in the room silently
stood in the doorway: as a local and a Muslim he belonged to both the performers and the audience, but as an Arab-Palestinian he also belonged to neither. From
his liminal position, he lent his support to the display in the only way he could:
by not complicating it. This way, he too joined the public effort to enact, or at
least not overtly challenge, the one-company approach. Thus, the event defused
potential conflicts across national boundaries, making them seemingly crossable
despite subtle hints of discomfort that belied the intended message.
The Limits of ‘One-Company’
As claimed, built into the attempt to tame national boundaries was the assumption of their persistence and strength. While silencing their political significance
and monitoring their cultural expression, the ‘one-company approach’ reaffirmed boundaries through the very act of trying to suppress them. In this sense,
it enacted not only a sense of ‘one’ but also of the multiplicity that challenged
it, setting limits to its implied unitary cohesiveness. Moreover, these limits
had other, more explicit formal expressions. When countervailing ideologies or
interests surfaced, management withdrew from the ‘one-company approach’,
creating practical spheres in which nationalities were treated not only as a given
to be tamed, but as barriers to be sanctified. Three such spheres were especially
evident: compensation, marketing, and top management composition.
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705
Compensation
Where rewards were concerned, management conjured up a sense of unalterable and
inviolable national boundaries quite in contrast with the spirit of ‘one-company’.
Apart from global bonus plans, compensation was strictly aligned with local standards and was determined by the dictates of national labor markets, leading to significant disparities in income between co-located members of similar organizational
status but different nationalities. Thus, Israelis were not to expect monetary rewards
comparable to those of European expats, whose generous compensation, they well
knew, included rent, private school tuition, and medical insurance. Unlike their
Israeli colleagues, expats, one Israeli interviewee complained, ‘get used to a very,
very high standard of living’. The same national distinctions applied to the compensation of Israeli and Palestinian employees. An Israeli HR manager explained:
‘All GN’s processes are valid for Ramallah as well, but the conditions of the Palestians’
employment are not Israeli conditions. They’re GNI employees but subject to the employment conditions of the Ramallah market. If it is customary here to give a car to every
engineer, and in Ramallah it is not, then the Ramallah engineers will not receive a car.
I have to imitate Ramallah — apply the rules of the Palestinian market to the Palestinians
we employ. So we contact other international companies like us, with experience over
there, and they help us a lot. We ask, “Is it customary to tell an employee that if he leaves
the company less than six months after his recruitment he must pay for the training
invested in him?” It turns out that it is, and so we add such an item to the work contract.
I befriended an HR manager of [a Palestinian client], a nice guy who gives me the same
lecture every time I call him, about how our nations are screwed, how the Palestinians are
fucked up and Sharon [the Israeli Prime Minister at the time] is also fucked up, and we
chat for half an hour until I get to the point — pay. “How much should we offer this or
that engineer?” And he gives me information. Because we do not want a situation in
which GN workers make much more than the local market.’
GNI’s employees, it should be noted, were well aware of these disparities.
Indeed, the disparities were a continuing source of dissatisfaction. A Palestinian
manager said:
‘My workers are Palestinians. They are proud to work for GN. They think of it as GN and
not as an Israeli company. Still, they feel that they aren’t treated well. They are paid less,
like Palestinian engineers in Ramallah. The HR people call local employers and ask how
much engineers are paid, and they pay accordingly. I recently asked for an adjustment but
I haven’t heard anything yet.’
Thus, management’s nationally based compensation practices resurfaced and
enshrined national boundaries that objectively and subjectively distinguished members not only according to seniority and position, but also according to nationality.
Marketing
National boundaries were evident not only in relation to labor markets, but also in
relation to national business markets. A ‘service orientation’ was a central tenet of
GN’s ethos and strategy. GN, in this view, should ‘customize’ its products and services to fit its culturally specific customers’ needs and whims. When this orientation
clashed with the ‘one-company approach’, it was the former that invariably won. For
example, ‘getting close to the market’, an oft-cited phrase, entailed a policy of
employing marketing and sales personnel from the clients’ nationality. The specific
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Organization Studies 30(07)
cultural resources the local personnel shared with clients were considered a crucial
element in the required job skills in this domain. To the CEO of GNI this was so obvious so as to go almost without saying. ‘The customer representatives are very local
because business is local,’ he stated matter-of-factly, indicating that the view of local
culture as a task-related business resource overrides the efforts to blur cultural boundaries derived from the one-company approach. Marketing, sales, and service policies
and practices that conceptualized clients and those best set to serve them, in cultural
terms, thus contributed to the resurrection and legitimization of local boundaries.
Top Management Composition
GN’s top executive positions were populated almost exclusively with citizens
of its European home base. This fact was neither hidden nor denied. On the
contrary — it was posed as a clear limit to the one-company approach. Consider
the following exchange between the CEO of GN who was visiting GNI, and
Dan, an Israeli employee who attended his talk:
Dan:
CEO:
‘We have subsidiaries in more than 140 countries from all over the world. Why
don’t we see more senior managers from outside XXX [the European country of
origin]? They could add perspectives; they could make GN open up more to the
world.’
‘That’s an excellent question. I think we should do this, we should promote such
thinking, there should be equal opportunity no matter where you come from.
What is important is expertise, regardless of culture. But you have to understand
that this is a company that was established in XXX, and it’s important to know
the culture. It sounds defensive, but, still, in every company the local culture is
built into the company. GN is not purely XXX, but it is XXX to a large extent,
for better and for worse. We have plans to try and bring people from all over the
world and give them opportunities to contribute to GN … but I don’t think that
it is possible to change the culture completely. There will always be XXX elements, whether you like it or not.’
The CEO’s answer may be seen as an attempt to balance the one-company
approach and its dictums with the apparent imperative of preserving and legitimizing the status of his own cultural capital and tradition within the multinational organization. For members, the significance of the clash between the
predominance of citizens of the company’s home base in senior management,
and the one-company approach, was abundantly clear. The following comment
by an Israeli engineer is typical:
‘Look, the President, the CEO, they are always from XXX. There are never people from
other countries in these positions. There is endless talk here about multiculture, multiculture, multiculture … they talk all the time but there is no multi. It’s all XXX.
Summary and Conclusions
GN’s management fostered and sustained the ‘one-company approach’ in three
ways. First, management created symbolic cohesion: designing and diffusing
emblems of a common identity and purpose, optimistic and attractive portrayals
of the membership body, unified categories and fields of exchange, and common
sets of values and behavioral standards. All helped create both an image and a
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sense of a solid global community (see Kunda 2006). Second, management
promoted and organized international meetings and training events and encouraged members to ‘network’, with an eye to forming a transnational social network
that transcended the company’s geographically based organizational structure. A
sophisticated communications network sustained the social network by enabling
members to contact each other and seek data and information from all over the
world. Finally, management required its members to tame their cultures of origin
in work-related public interactions and ceremonies, making them transparent in
the former and friendly and unthreatening in the latter.
Taken together, these practices constructed a coherent and seemingly allencompassing view of GN as a transnational social collective that suppressed
national differences and created an image of a shared and undifferentiated experience of membership. There were, nevertheless, arenas in which management
suspended the ‘one-company approach’ and allowed competing ideologies to
prevail. Routinely, this was most pronounced when the ‘one-company approach’
challenged compensation practices, the service orientation, or home-base hegemony. Here, national boundaries not only surfaced and were acknowledged, but
were reified and strengthened. Thus, where competing interests and ideologies
were concerned, management conjured up a sense of national distinctions, reinstating them as powerful barriers between members.
Moreover, at GNI, a subsidiary located at the heart of a violent national conflict, the formal reification of national boundaries was expressed not only in routine matters such as compensation, but also in matters of rescue and relief. Inside
its Israeli–Palestinian subsidiary, GN’s transnationalism did not apply to issues
such as gas-mask distribution and evacuation plans: management bought masks
for the Western expatriates, not for the Palestinian employees, and prepared to
evacuate only those whose national origin was not Middle Eastern. While there
was a European ‘Crisis-Management Center’, which served as a symbolic shock
absorber — marking corporate concern for its local employees’ fates — when
actions were required, management did not seek to alter these fates. Workers
were thus defined in national terms just as much as in transnational terms and
were primarily required to accept the following corporate principle: they must
tame their national cultural tendencies to help sustain management’s effort to
build a transnational community, but they must not expect the transnational community to exert any unprofitable effort to help them survive their national fates.
These findings thus lead to two possible conclusions. First, at least as far as the
MNC under study is concerned, management does indeed lay foundations for a
transnational ‘imagined community’, complete with a sense of capitalist destiny and
professional comradeship with numerous others across the world. One may question the depth and meaningfulness of this transnational community, the degree to
which it can and does rival the potency and command of the national one, but the
fact is that this community does not seek such rivalry. Our second conclusion is precisely this: the transnational imagined community is formally designed not to compete with but to coexist with the national one in a way that creates a new arena for
managerial discretion in deciding when to activate and when to suppress national
boundaries in definitions of work situations. The ‘national’ is not challenged: under
some circumstances it is tamed, and in others it becomes a tool managers use
to enhance profits, cut costs, or protect their own status. In short, once national
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Organization Studies 30(07)
boundaries are incorporated into the very fabric of a worldwide organization, they
become objects of management diagnosis and control. Thus, MNCs do not replace
nationalism nor do they erode it; rather, they provide another arena for the expression of nationalism and its shaping by those who have the power to do so.
Our findings have several implications. First, with regard to transnationalism,
it is necessary to reformulate the question central to many theoretical endeavors.
The critical issue, it seems, is not to what extent MNCs replace or compete with
the nation-state, but how they make use of nationalism, national identity, and
national sentiment in their operations. As our case indicates, there is no clear
dichotomy between the MNC’s transnational interests and the countervailing
forces of nationalism as simultaneously represented by the external dictums of
state institutions and the internal cultural limitations or political interests of the
workforce. Rather, the forces pushing for transnationalism and nationalism are
located within the company and its logic, and the question becomes when, how,
why, and to what effect management chooses to implement each.
Thus, our study problematizes the tendency of many theorists to take management’s global rhetoric for granted and adopt it as their point of departure. Granted
that ‘an increasing number of corporations operating outside their countries of origin see themselves as globalizing, as is obvious if we read their annual reports and
other publications’ (Sklair 2002: 38), this tells us little about the actual workings of
these corporations or the way the publicly presented global self-images are manifested or implemented in everyday life. Similarly, organizational rhetoric about
multiculturalism and diversity should also be taken with a grain of salt. Thus, at
GNI, ‘multiculturalism’ did not extend to top management, populated almost
entirely by citizens of GN’s home base, and ‘diversity’ was overtly applied only to
the distinction between Israeli Jews, European Christians, and Turkish Muslims,
not to the Israeli/Palestinian distinction. Indeed, the fact that the Palestinians were
not acknowledged as a distinct cultural group in cross-cultural workshops and organizational ceremonies indicates how politically nuanced is the actual implementation of these supposedly apolitical ideals and the degree to which they echo internal
and external power plays between members with different national affiliations.
This latter point challenges not only simplistic images of MNCs as global ‘black
boxes’, but also more nuanced images of their internal operations as set forth by
writers influenced by the National Business Systems perspective. The challenge is
twofold. First, while recognizing the conflicting institutional pressures operating
inside MNCs, these writers often conceptualize such conflicts as gaps between
the subsidiaries’ local institutional contexts and the HQ’s coercive pressure ‘for
more global consistency and standardization’ (Geppert and Williams 2006: 491).
However, as our case indicates, HQ’s coercive pressure could be quite complex and
contradictory, promoting global consistency and standardization in certain arenas
and global inconsistency and deliberate lack of standardization in others. Second,
our case indicates that, in order to understand the dynamics of MNCs, we must take
into account not only ‘the problems of institutional pluralism’ (Morgan and
Kristensen 2006: 1486) — as these writers typically do — but also the problems
resulting from the fact that this ‘pluralism’ hardly reflects a neutral or uncontested
distribution of power. The different national environments are in fact characterized
by tensions, conflicts, and considerable power differentials. In other words, it is
not only ‘micro-politics’ that come into play inside MNCs (e.g. Geppert and
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Williams 2006; Sharpe 2006; Geppert and Mayer 2006), but also ‘macro-politics’.
Thus, while our case study is no doubt unique, characterized by a very particular
combination of institutional environments, and while it is plausible to assume that
other MNCs function quite differently, the study does indicate two blind-spots that
prevail in current conceptualizations. Awareness of the nuanced complexity of the
formal work order, and of the ways it reflects not only internal but also external
power plays, may enrich our understanding of MNCs.
Moreover, if, as many theorists claim, MNCs are spearheading globalization,
then there are broader theoretical concerns to be addressed. The emergence of
global culture, for one, may be seen not as challenging, overruling, or annulling
national culture but as creating the conditions for flexibly and fragmentarily
redefining it, turning it from an absolute and predominant category of identity, a
‘given’, into one that can be activated or suppressed, emphasized or de-emphasized,
reified or disregarded, and manipulated by many more actors besides those who
rule, or try to rule, states. In this sense, ‘global culture’ does not mark the demise
of nationalism as much as its appropriation to the transnational realm, where it
is symbolically reconfigured to sustain new forms of ‘imagined communities’
and serve various goals and interests within them.
In a similar vein, accounts of consumer culture, seen by many as the epitome of
the transnational logic of global capitalism, should be balanced by awareness that
it, too, is not ‘purely’ global. It rests, in fact, upon nationally based marketing units
and a conviction about the importance of the national element in making the sale.
Thus, while in many ways the market is perceived as global, consumers’ tastes are
often conceptualized in local terms as expressing culturally determined preferences
and conveying national particularities. In this sense, the marketing function —
charged with stimulating and sustaining the diffusion of consumerism around the
world — also continually reifies existing national borders, sanctifying them as
proxies for the diversity of tastes. Here too, then, we see that globalization’s cultural
forms are not ‘beyond’ or ‘above’ the nation, but in fact incorporate nationalism in
complex ways that are not only politically induced but also shaped by managerial
conceptualizations of the market.
To summarize, in the ‘transnational social space’ we studied, we found a ‘onecompany approach’, a complex multiplicity of national affiliations, and a managerially designed set of implicit and explicit rules about when and how each is to be
expressed or suppressed, celebrated or silenced. It was, as GNI members called it,
a ‘global bubble’: a space separated from external turmoil by a thin, translucent
membrane designed neither to shield nor shelter but merely engulf members of
conflicting national identities in a bounded, well-rounded collective that lies outside national reality, without making national affiliation any less relevant for them.
GN did set up a transnational ‘imagined community’ — a global regime of consciousness for its large and dispersed membership body — but rather than rivaling
or contradicting the national regime of consciousness, it became another arena in
which the strength and persistence of national identities, as well as their political
and economic consequences, could be displayed in new ways.
Note
Partial funding for this project was provided by Stiftelsen Riksbankens Jubileumsfond’s ‘The
network society from within’ research program. We wish to thank participants in the program for
helpful comments.
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710
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Galit Ailon
Galit Ailon is a Lecturer in the Department of Sociology and Anthropology at Bar-Ilan
University. She received her PhD from the Department of Labor Studies at Tel Aviv
University. She is author of Global Ambitions and Local Identities: An Israeli-American
High-Tech Merger (Berghahn Books, 2007). Her research interests include organizational
globalization, organizational theory, and managerial discourse.
Address: Department of Sociology and Anthropology, Bar-Ilan University, Ramat-Gan
52900, Israel.
Email: [email protected]
Gideon Kunda
Gideon Kunda is an Associate Professor in the Department of Labor Studies at Tel Aviv
University. He holds a PhD in organization studies from the Massachusetts Institute of
Technology. His research interests include the culture of post-industrial work and organizations. He is the author (with Stephen Barley) of Gurus, Hired Guns and Warm Bodies:
Itinerant Experts in a Knowledge Economy (Princeton University Press, 2004). A revised
edition of his book Engineering Culture: Control and Commitment in a High-Tech
Corporation was published by Temple University Press in 2006.
Address: The Department of Labor Studies, Tel Aviv University, Tel Aviv 69978, Israel.
Email: [email protected]
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